Pierre Pellaton Enterprises, Inc.

1070 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Pierre Pellaton Enterprises, Inc.; Pierre Pellaton Apartments at Mineola, Inc.; Pierre Pellaton Apartments, Inc.; Pierre Pellaton at Clinton Avenue, Inc.; Fardale Apartments Corp.; Pierre Pellaton an Individual, and Estate of Pierre Pellaton; and Michael Kluger, Fred Seidenfeld and Aaron Sokol, a co-partnership doing business as S.K.S. Associates and Local 307, Service Employ. ees International Union, AFL-CIO. Case 29-CA- 2670 March 25, 1977 NOTICE TO SHOW CAUSE BY CHAIRMAN MURPHY AND MEMBERS FANNING AND WALTHER On January 23, 1976, the National Labor Relations Board issued a Supplemental Decision and Order 1 in the above-entitled proceeding in which the Board adopted the findings and conclusions of the Admin- istrative Law Judge as contained in his Decision of May 30, 1975, and ordered the Respondent, Michael Kluger, Fred Seidenfeld and Aaron Sokol, a co- partnership doing business as S.K.S. Associates, to pay to the discriminatees the amounts set forth in the backpay specification, as amended, as recommended by the Administrative Law Judge. Thereafter, on August 26, 1976, the parties to the court proceeding stipulated that the Board's applica- tion to the United States Court of Appeals for the Second Circuit for enforcement of its Order be withdrawn so that the Respondent, S.K.S. Associ- ates, could be afforded an opportunity to present its position concerning the settlement stipulation en- tered into January 21, 1975, between the General Counsel, the Estate of Pierre Pellaton, Local 307, Service Employees International Union, AFL-CIO, and the four claimants. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to the three-member panel which participated in the Supplemental Deci- sion and Order. The Board having duly considered the matter, Notice is hereby given that cause be shown, in writing, filed with the Board in Washington, D.C., on or before April 11, 1977 (with affidavit of due service of copies on the other parties to this proceeding), why the Board should not fmd that the Estate of 1 222 NLRB 555. 2 In issuing this Notice To Show Cause we are not rejecting a hearing before an Administrative Law Judge, as proposed by our dissenting colleague, as a possible alternative to the course we have suggested . Indeed our Notice To Show Cause is issued at least in part to provide the parties an 228 NLRB No. 139 Pierre Pellaton and S.K.S. Associates are jointly and severally liable for the backpay accruing after September 15, 1972.2 MEMBER WALTHER, dissenting: I cannot join my colleagues in issuing a Notice To Show Cause in this proceeding. Rather, in view of the unusual circumstances surrounding this case and its present posture, I conclude that a remand of this proceeding to the Administrative Law Judge is necessary. The background of this case is as follows: On January 24, 1973, the Board issued its Decision and Order in this proceeding,3 in which it found, inter alia, that Respondent, Pierre Pellaton Enterprises, Inc. (herein called Pellaton Enterprises), had violated Section 8(a)(3) by discriminatorily discharging four employees and ordered, inter alia, that Pellaton Enterprises, its officers, agents, successors, and assigns, offer the four discriminatees reinstatement and make them whole. Thereafter, on January 29, 1974, the Board's Order was enforced by the United States Court of Appeals for the Second Circuit by default judgment. On October 23, 1974, the Regional Director for Re 'on 29 issued an amended backpay specification and notice of hearing, naming as Respondents both Pellaton Enterprises and S.K.S. Associates, which had acquired the properties of Pellaton Enterprises on September 15, 1972. Prior to the opening of the hearing, on January 21, 1975, Pellaton Enterprises entered into a settlement stipulation with counsel for the General Counsel, the Charging Party, and the four discriminatees pursuant to which it paid sums due the discriminatees for the period from the commencement of backpay liability until September 15, 1972. Counsel for the General Counsel then withdrew from the backpay specification the allega- tions concerning Pellaton Enterprises. At the hearing, counsel for the General Counsel submitted the settlement stipulation to the Adminis- trative Law Judge for approval. The Administrative Law Judge, although receiving the stipulation into evidence, declined to approve or disapprove it. Subsequently, the Administrative Law Judge issued his Supplemental Decision in which he found that Pellaton Enterprises was not a party to the proceed- ing. He further found that S.K.S. Associates became a bona fide successor to Pellaton Enterprises on September 15, 1972, and provided in his recommend- ed Order that S.K.S. Associates make whole the named discriminatees from that date. opportunity to state their positions as to how the Board should proceed. We are, however, unwilling to pass on the objections raised by our dissenting colleague to the course we have proposed until the parties have had an opportunity to state their positions on the matter. 3 201 NLRB 409. PIERRE PELLATON ENTERPRISES 1071 Thereafter, on January 23, 1976, the Board issued its Supplemental Decision and Order4 in which it adopted the findings, conclusions, and recommended Order of the Administrative Law Judge as contained in his Supplemental Decision. However, in so doing, Chairman Murphy and I, comprising the panel majority, joined in the following footnote which read, in pertinent part: Inasmuch as the settlement agreement is not before us, we express no opinion as to the propriety of the General Counsel's action in settling with the Pellaton parties or the acceptabil- ity of the terms of that agreement. Furthermore, inasmuch as the Pellaton parties are not before us, our decision herein is limited to a resolution of the issue of S.K.S.' liability. Our decision, there- fore, is not to be construed as a finding or a determination that the Pellaton parties are ab- solved from primary responsibility for making whole the discriminatees for any losses they may have sustained following S.K.S. Associates' suc- cessorship... . Member Fanning expressly did not join in that footnote. Thereafter, on August 26, 1976, the Board and S.K.S. Associates stipulated that the Board's applica- tion to the court of appeals for enforcement of its Supplemental Order be withdrawn and that Respon- dent S.K.S. Associates be afforded the opportunity to present its position to the Board concerning the settlement stipulation of January 21, 1975. Thus, the Board now has before it an issue involving the allocation of backpay liability under Perma Vinyls between the predecessor, Pellaton Enterprises, and the successor, S.K.S. Associates, in a posture in which the settlement stipulation entered into by Pellaton Enterprises has never been approved by the General Counsel, the Administrative Law Judge, or the Board, and under circumstances in which Pellaton Enterprises is not a party to the instant proceeding. My colleagues have decided to issue a Notice To Show Cause why Pellaton Enterprises and S.K.S. Associates should not be held jointly and severally liable for backpay accruing to the discriminatees after September 15, 1972. My colleagues thereby have indicated their intention to resolve the substantive issue in its present posture, despite the express findings of the panel majority in the Board's Supplemental Decision that neither the settlement stipulation nor Pellaton Enterprises was before the Board. I fail to see how the issuance of a Notice To Show Cause effectively cures either of these procedural infirmities. Rather, the use of a notice to show cause to determine the issue of whether or not to impose joint and several liability herein can only result in substantial prejudice to either Pellaton Enterprises or S.K.S. Associates and in further enmeshing this Board in a procedural thicket. Given the unusual circumstances of this case, I consider a remand to the Administrative Law Judge necessary in order to join all parties involved into a single proceeding and to place the settlement stipulation before the Administrative Law Judge for ruling. Thereafter, if review of the Administrative Law Judge's decision is sought, the Board would then have all the parties, their positions, and the settlement stipulation before it. In my view, a remand to the Administrative Law Judge is the only course available here which can afford both Pellaton Enterprises and S.K.S. Associates the fundamental due process to which they are entitled. Accordingly, I dissent. 4 222 NLRB 555. 5 Perma Vinyl Corporation, Dade Plastics Co. and United States Pipe and Foundry Company, 164 NLRB 968 (1967).